Tender Offer - London Stock Exchange

1 Tender Offer - London Stock [8/14/2012 9:20:34 AM]Regulatory StoryGo to market news section CompanyAqua Resources Fund LimitedTIDMH2 OHeadlineTender OfferReleased07:34 14-Aug-2012 Number9517J07 RNS Number : 9517 JAqua Resources Fund Limited14 August 2012 14 August 2012 Aqua Resources Fund Limited The Board of Aqua Resources Fund Limited ("Aqua" or the "Company") today announces an outlineproposal (the "JPM PEA Proposals"), received from the Private Equity Advisor Group at JPMorganAsset Management ("JPM PEA"), to increase its shareholding to up to of the Company,subject to final agreement of terms and processes with the Board. In the context of the Company's intention, announced on 28 June 2012, to propose the cancellationof the listing of the Company's ordinary shares (the "Ordinary Shares") on the Official List of the UKListing Authority and from trading on the London Stock Exchange 's Main Market for Listed Securities("the Cancellation"), the Company further announces its intention to seek shareholder approval toamend its investment policy to preclude further new investments and to remove the diversificationtest.

2 The JPM PEA Proposals JPM PEA manages JPMorgan Private Equity Limited and JPMorgan Special Opportunities Fund(collectively, the "JPMorgan Funds"), which together currently hold 11,371,926 ( ) of theCompany's Ordinary Shares. Under the JPM PEA Proposals, JPM PEA has indicated to the Board thatthe JPMorgan Funds would be willing to acquire up to 10,294,911 Ordinary Shares for 35 cents each(the " Tender Price"), from those shareholders who would like to sell down some or all of theirshareholding ahead of the Cancellation. This Tender Price of 35 cents is at a premium of percent to the closing price as at close of business on 13 August 2012 (being the last business daybefore this announcement).

3 To facilitate the JPM PEA Proposals, the Company has agreed to conduct a Tender Offer (the "TenderTender Offer - London Stock [8/14/2012 9:20:34 AM] Offer ") for up to 10,294,911 (representing of the current Ordinary Shares in issue) OrdinaryShares (or such other number of Ordinary Shares which when taken with the JPMorgan Funds'shareholding on the effective date for the Tender Offer would not cause JPM PEA and the JPMorganFunds to control more than of voting rights in the Company) (the " Tender Threshold"), at theTender Price in October 2012. Shareholders will be able to Tender none, some or all of theirshareholding.

4 To the extent that shareholders Tender shares in excess of the Tender Threshold,applications will be scaled back pro rata. JPM PEA, on behalf of the funds it manages, has agreed toacquire all tendered shares for 35 cents. If the Tender Offer is fully subscribed, funds managed byJPM PEA would together hold 21,666,837 ( ) of the Company's Ordinary Shares. The Cancellation As noted in the Chairman's Statement in the Annual Report and Accounts of the Company for theyear ended 31 December 2011 (published on 26 April 2012) and its interim management statement(published on 18 May 2012), the Company no longer meets the "free float" requirement of the UKListing Rules (Listing Rule ) which stipulates that 25 per cent of the shares in a company listedon the Official List of the UK Listing Authority should be held in 'public hands' (which excludes sharesheld by shareholders who are directors or who own more than 5 per cent.)

5 Of the share capital ofsuch company). In considering the proposed Cancellation, the Board has reviewed:1) the poor liquidity and very low daily turnover in the Shares on the London Stock Exchange , whichthis calendar year have traded on only 45 days,2) the persistently wide share price discount to net asset value (currently approximately 70 percent.),3) the concentration of the portfolio,4) the advantages and disadvantages of a listing of the Ordinary Shares on another recognised stockexchange in the context of the known views of certain shareholders,5) an overview of the current shareholder base, and6) that a delisting will entail a material change for shareholders.

6 Subject to regulatory clearances and Shareholder approval at an extraordinary general meeting (the"EGM"), it is expected the delisting will become effective around the end of October 2012. Amendment to the Investment Policy At the EGM, the Board intends to put forward an ordinary resolution to shareholders to amend theCompany's current investment objective and policy. It is proposed that the current investmentobjective and policy is supplemented with the following provision: "No New Fund InvestmentsIt is the general policy of the Company not to make new fund investments. It is the intentionof the Company to continue to meet its existing capital commitments.

7 The Company maysupport follow-on commitments in existing investments subject to prior approval by theBoard of such investment." Tender Offer - London Stock [8/14/2012 9:20:34 AM] It is also proposed that the following text is deleted from the diversification section of the currentinvestment objective and policy: "Once investments have been completed, it is anticipated that no single investment, at thetime of acquisition, may exceed 30% of the gross assets of the Company." "In addition, in exceptional circumstances, the Board may authorise the acquisition of aninvestment or asset which exceeds the 30 per cent limit and is up to 50% of gross assets, atthe time of acquisition.

8 Such authorisation may only be given in circumstances where theBoard considers the acquisition to be of strategic importance to the Company in achieving itsoverall investment objective and the Manager has, at the time of acquisition, presented tothe Board for approval a proposal for rebalancing the Portfolio to within the 30% limit assoon as practicable (and in any event within a period not exceeding 18 months) by means offurther capital raisings, additional investments, disposals of part of an investment orotherwise." In all other respects the current investment objective and policy will remain unchanged. Further details of the JPM PEA Proposals, Cancellation and associated amendments to theCompany's articles of incorporation, amendment to the investment policy and notice of EGMexpected to be held in September 2012 (rather than August 2012 as indicated in the announcementon 28 June 2012.)

9 , will be contained in a circular to be posted to shareholders as soon as practicable. For further enquiries:Aqua Resources Fund LimitedHasan Askari, Chairman +44 (0)7785 307 759 FourWinds Capital Management, Investment Manager Tara, Chief Executive Officer Cenkos Securities plcWill Rogers +44 (0)20 7397 1920 Important Information The information related to the Company included in this statement is provided for informationpurposes only and does not constitute an invitation or Offer to subscribe for or purchase shares inthe Company.

10 This material is not intended to provide a sufficient basis on which to make aninvestment decision. All investments are subject to risk. An investment in the Company should beregarded as long term in nature and is suitable only for sophisticated investors, investmentprofessionals, high net worth individuals, unincorporated associations and partnerships and trusteesof high value trusts, in each case, who can bear the economic risk of a substantial or entire loss oftheir investment. Prospective investors are advised to seek expert legal, financial, tax and otherprofessional advice before making any investment Offer - London Stock [8/14/2012 9:20:34 AM]This information is provided by RNSThe company news service from the London Stock Exchange END TENUSUNRUKAWARR London Stock Exchange plc is not responsible for and does not check content on this Website.